With the worldwide impact and economic repercussions of the COVID-19 pandemic, it is inevitable that numerous businesses have taken a hard hit. This is no exception for Japan. In a bleak job market and economic environment, it may seem daunting to set up their business. However, this presents an excellent opportunity to kickstart your entrepreneurship dream. The first step to starting your business in Japan is to register company in Japan. We will explore what are the popular businesses for foreigners to start up in Japan 2023.
Ranked as the world’s third-largest economy after the United States and China, it is no wonder that Japan remains a key market for both international and small businesses. While living and working in Japan is a unique experience for many aspiring entrepreneurs, there are bound to be challenges when you start a business in Japan. Therefore, it is crucial that you choose a business idea that caters to the needs of the Japanese market prior to setting a business in Japan. Here are 13 popular businesses that you can consider setting up:
1. Import and export
With Japanese consumers having high disposable incomes, this has led to a heightened interest in high-end goods and growing demand for globalised services. This presents opportunities for individuals to engage in import and export businesses as they can leverage Japan’s love for foreign goods. This includes food products, fashion items, cars, furniture and alcohol. Additionally, individuals may also export items in Japan back to their home countries to sell.
Setting up an agricultural business is a viable option provided there is demand for food and other types of agricultural products in the country. This applies to Japan as there is great demand for fruits and vegetables, as well as livestock products like eggs and cheeses. If you have experience in the agriculture field, Japan is an ideal place to start a business. Moreover, starting an agricultural business only requires a small amount of capital and it is possible to start one without formal qualifications or certificates.
3. English language schools
It is a common sight to witness foreigners teaching English conversation classes at public schools or private language schools in Japan. Japanese do not usually speak fluent English, as demonstrated with a ranking of 55th out of 100 countries worldwide in the Education First EF English Proficiency Index (EPI). Teaching English provides a platform for foreigners to obtain a visa and experience if teaching as a career is suitable for them. Moreover, you can research the market and determine if you could develop a niche of teaching children or focus on business English.
Another popular business idea in Japan is setting up a restaurant due to its relative ease. Japan is a food culture where there is a wide array of popular Japanese food items, such as mochi balls and sushi. Depending on your preferences, you can create a restaurant concept based on food from your country or Japanese food. Indian curry, British pubs, American burgers are some of the many popular offerings and have sprung up around big cities such as Tokyo.
5. Real Estate
The real estate industry thrives in any fast-growing economy, such as Japan. Japan is one of the only countries in Asia where foreigners are able to own properties. While the real estate industry may not be the easiest industry to navigate, there are numerous untapped opportunities and potential in Japan for real estate investors.
6. Alternative Medicine
Alternative medicine is a lucrative sector in Japan, which is similar to countries such as India and China. As there is substantial demand for herbal medicine products and natural health practitioners, it presents massive business opportunities in the alternative medicine practice industry. This line of business is thriving and profitable in the country. Therefore, you should start a business in Japan if you are knowledgeable about yoga, Ayurveda medicine, homoeopathic medicine or other practices in alternative medicine.
7. Drone services
While Japan implemented a number of laws regarding where and when drones can be flown, the commercial drone delivery business remains one of the viable businesses to start in Japan. It involves assisting your clients to deliver their goods or packages via drones to their intended destination. With a commercial drone delivery business, you can either open an online or offline store or choose to operate without a store.
Moreover, you could sell aerial photography shots and photos and videos of wedding receptions too.
8. Massage and salon
In Japan, people love to pamper themselves and it is a Japanese trend to get massage therapy. Opening a spa is a good business idea if you are able to develop a niche and offer a unique experience such as Swedish Massage. It would be ideal if you can get your certification in massage therapy.
9. Game centres & casino
Video gaming in Japan is a major industry. You can consider setting up a casino and game centre in an area where many gamers and gamblers gather. Casino and game centres are popular industries around the world, and are not only found in Las Vegas. Hence, these are profitable businesses as there will always be demand available from individuals who love gaming and gambling and are constantly seeking such opportunities.
10. Online retailing
Given the busy lifestyles of the Japanese, setting up an online retail store is a good and lucrative choice along with physical stores. Boasting a large consumer market, the country presents unlimited opportunities for your retail business. Additionally, you could stuff your online store with a wide range of quality goods at very competitive prices. Another advantage of setting up an online retail business is that you are not required to pay rental fees.
11. Business consulting
As more foreigners are cognizant of the huge business prospects in Japan, the number of new businesses by foreigners is rapidly increasing. However, overseas investors are facing challenges of adapting to Japan’s business climate and connecting well with customers. As a business consultant, you can help these businesses attain their goals swiftly by providing them advice on how to pull in more customers, boost sales and thrive amid tough competition.
12. Event Planning Business
It is one of the small scale businesses in Japan that you could engage in if you specialise in managing events. This includes coordinating the wedding elements and making arrangements at parties. Prior to starting an event planning business, you should learn about the event management industry and aim to set yourself apart from your competitors.
13. Automated vending
With the highest density of vending machines worldwide, Japan has approximately 1 vending machine per every 23 people, according to the Japan Vending Machine Manufacturers Association. Vending machines not only sell food and drink products, but they also offer a wide range of products such as books, shoes, clothes and perfume. Vending machine business is popular among foreigners as it requires minimal supervision. You have to ensure that the machines are constantly filled with products and are installed in places with high traffic.
Japan company registration is hassle-free if you are familiar with the entire incorporation process. Tetra Consultants strives to provide our clients with a seamless experience when setting up a company in Japan. Our team of experts will ensure that your Japan company can be operationally ready as soon as possible.
FAQCan I start a business in Japan as a foreigner?
- Yes, a foreigner can start a business in Japan. However, there are certain legal requirements that must be met. Firstly, a foreigner must have a valid visa that allows them to engage in business activities in Japan. There are several types of visas that permit business activities, such as the Business Manager visa or the Investor/Business Manager visa.
- Secondly, a foreigner must register their business with the government. This can be done by either establishing a new company or registering a branch office of a foreign company. The process for company registration in Japan can be complex, and it is recommended to seek the assistance of a legal or business advisor.
- Additionally, depending on the type of business, a foreigner may need to obtain additional licenses or permits. For example, if the business involves the sale of alcohol, a license from the local government may be required.
What type of business should I start in Japan?
- When considering what type of business to start in Japan, it is important to think about the country’s strengths and opportunities. Japan is a world leader in technology and innovation, with a highly skilled workforce and a culture of excellence. This makes it an ideal location to start a technology-based business, such as developing software, mobile apps, or creating hardware products. Additionally, with an aging population, there is a growing demand for healthcare technology and services, making it a potential area for entrepreneurship.
- Another sector to consider is tourism. Japan is a popular destination for both domestic and international tourists, with a rich cultural heritage and natural beauty. Starting a business in the tourism industry can be a lucrative opportunity, whether you focus on providing guided tours, offering unique cultural experiences, or opening a guesthouse or homestay. The food and beverage industry is also a potential area for entrepreneurship, with Japan’s renowned cuisine attracting foodies from around the world.
What business to invest in Japan?
- Some business sectors to consider investing in Japan include technology, tourism, and renewable energy. The country is a leader in technology and innovation, making it a potential area for investment. Additionally, with a growing tourism industry and increased investment in renewable energy, there are opportunities for investment in these sectors as well. Ultimately, the best business to invest in will depend on your investment goals and risk tolerance, as well as a careful analysis of the market.
Is Japan a good place to start a business?
- Japan is a favorable location to start a business, especially for those who are interested in technology, innovation, and high-quality products and services. The country has a strong economy, a highly skilled workforce, and a culture that emphasizes excellence, making it an ideal place for entrepreneurs to establish a business. Japan’s supportive business environment, which offers various programs and incentives to encourage entrepreneurship and foreign investment, is another advantage.
- Japan is renowned for its dependable infrastructure, advanced technology, and protection of intellectual property, which can make it easier for businesses to operate and compete globally. In addition, Japan provides a stable political and economic environment, providing business owners with a sense of security and predictability.
- Overall, although starting a business can be challenging, Japan offers several advantages and opportunities that make it a great place to establish and expand a business.